Haggen to sell 29 stores to Albertsons for $106 million, close Oregon City store

Haggen on Friday announced it would sell 29 of its remaining core stores to Albertsons and close three others, marking one of the final stages in what has been a tumultuous year for the now bankrupt grocer.

Early in bankruptcy proceedings, Haggen indicated it hoped to retain these core stores, comprised of a few dozen profitable stores in Washington and Oregon.

Court documents show that Haggen received six bids for its core stores, but Albertsons was the only qualifying bid. So after weeks of delayed and cancelled auctions, Albertsons is the winning bidder by default.

"[Haggen] determined ... that the Albertson's Bid--the terms of which had significantly improved as a result of the parties' arm's-length, good faith negotiations--was the sole Qualifying Bid and the highest or otherwise best bid with respect to the assets subject to the Core Sales. Importantly, the Albertson's Sale provides the Debtors with a clear path toward exiting chapter 11," a court filing reads.

According to a purchase agreement between Albertsons and Haggen filed in bankruptcy court on Friday, Albertsons will pay a base amount of $106 million, plus a closing adjustment amount, for the stores. It will put down a deposit of $68 million.

The sale of the stores to Albertson's will be staggered over roughly four months, a separate document shows.

In addition, Haggen is seeking court approval for a financing agreement with Albertsons, as its current debtor-in-possession loan of $215 million was set to expire on Friday.

Both the sale and the new financing agreement are subject to court approval. Haggen has requested a hearing date of March 29.

However, three core stores weren't included in the sale. In a statement Friday, Haggen said it plans to close these stores in the next 60 days:

19701 Highway 213, Oregon City, OR

201 37th Avenue SE, Puyallup, WA

114 E. Lauridsen Blvd., Port Angeles, WA

Haggen is also closing its stores in Happy Valley and West Linn in Oregon, and Burien and Federal Way in Washington.